Preparing your business for sale
Buyers are paying for the future, but they judge it on the past. The two or three financial years before a sale are the ones a buyer will pick apart, so that is where preparation pays off most.
We start with a readiness review: how the numbers look, how dependent the business is on you, where the risks are and what a buyer would question. From there we build a plan to fix the fixable: separating personal expenses, documenting systems, locking in customer contracts, putting a second-in-charge in place and tidying the balance sheet.
This is also when the structure gets sorted. If the trading entity owns the premises, the vehicles and a few things that are really yours, a buyer either pays less or walks. Separating what you keep from what you sell is often the most valuable preparation step.
- Clean, consistent financial statements for the past three years
- Normalised profit with owner and one-off adjustments explained
- Systems, processes and roles documented
- Key contracts, leases and licences in order
- Structure that lets the buyer purchase exactly what they want
- Data room ready before you go to market
Setting the right asking price
Price too high and the business sits on the market while word gets around. Price too low and you give away years of work. We value the business properly, show you the evidence behind the number and explain what buyers in your industry are actually paying.
Just as important, we identify what would move the price. Sometimes a six-month delay to improve recurring revenue or reduce owner dependence is worth far more than any negotiation tactic.
Timing the market matters less than timing the business. Buyers look at the trend over the last three years, so selling off the back of a flat or declining year costs real money. If the trend is heading the wrong way, fixing that comes before any listing.
Tax when you sell a business
Selling a business usually triggers capital gains tax, but the tax system includes concessions for small business owners that can reduce the gain substantially when the conditions are met. Eligibility depends on things like turnover, net assets, how long you have owned the business and how the sale is structured.
Whether you sell assets or shares, how the price is allocated across goodwill, equipment and stock, and whether an earn-out is involved all change the tax result. GST can also apply unless the sale qualifies as a going concern. We model the alternatives under the ATO's current rules before terms are agreed, so the structure is chosen deliberately rather than inherited from the buyer's first draft.
Negotiating and closing the sale
Once a buyer is engaged, the hard part starts. Their accountant will run due diligence, question your adjustments and look for reasons to lower the price. We prepare you for those questions, answer the technical ones directly and keep the deal on track.
We also work with your lawyer and broker on the heads of agreement and the contract. Working capital adjustments, retention amounts, vendor finance, earn-out definitions and restraint periods all have financial consequences that are easy to miss in legal language.
Confidentiality is part of the job too. Staff, customers and competitors hearing about a sale too early can damage the very business you are selling. We help you decide what to share, when and with whom, and keep the sensitive material in a controlled data room.
- Buyer Q&A and due diligence support
- Review of offers and deal structures
- Working capital and settlement adjustments
- Earn-out and vendor finance modelling
- Coordination with lawyers and brokers through to settlement
Life after the sale
A sale changes your personal finances overnight. Where the proceeds land, how they are invested, whether superannuation plays a role and what structures you keep all deserve attention before settlement, not after.
Many clients go on to buy their next business, invest or step back entirely. Because we work across accounting, structuring, SMSF and advisory, we can keep supporting you whichever direction you take.
The sale also closes out the old entity: final BAS, final tax return, employee entitlements, loans and any retained assets. We handle that wind-down so nothing lingers.
Questions we get asked
How long before selling should I start preparing?
Ideally two to three years. That gives time to improve the financial trend, reduce owner dependence, restructure if needed and satisfy holding period conditions for tax concessions. If you have less time, we focus on the changes with the biggest effect on price and the cleanest presentation of what you have.
How is a business sale taxed in Australia?
The sale usually creates a capital gain on goodwill and other assets. Small business CGT concessions can reduce or defer that gain if the eligibility tests are met. The structure of the sale, the entity that sells and the allocation of the price all affect the result, so modelling before agreement matters.
Should I sell the shares in my company or the business assets?
It depends. Buyers often prefer assets because they leave the company's history behind. Sellers often prefer shares for simplicity and sometimes for tax. The right answer comes from modelling both, understanding what the buyer needs and negotiating the difference in price and warranties.
Do I need a business broker as well as an accountant?
A broker finds buyers and manages the marketing process. We handle valuation, preparation, tax structuring and the financial side of negotiation. Many sales use both. Some, such as sales to a competitor, staff or family, may not need a broker at all. We can help you decide.
What do buyers look for when buying a small business?
Consistent profit, recurring revenue, a team that runs the business without the owner, documented systems, secure premises and contracts, and clean tax and payroll compliance. The fewer surprises a buyer finds in due diligence, the more confident they are in the price and the faster the deal moves.
